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2019-06-19

min answer › question first answered

2019-07-01T09:32:22.537Z

hansard heading

Political Parties: Finance

answer › answering member printed

Kevin Foster

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To ask the Minister for the Cabinet Office, pursuant to the Answer of 1 July 2017
to Question 268970, whether his Department received proposals from the Electoral Commission
on the implementation of section 10 of the Political Parties and Elections Act 2009.

<p>The Electoral Commission set out their concerns and recommendations for implementation
in their 2013 report ‘<em>A regulatory review of the UK’s party and election finance
laws: Recommendations for change</em>’.</p>

To ask the Minister for the Cabinet Office, pursuant to the Answer of 24 June 2019
to Question 266672 on Political Parties: Finance, for what reason the Government considers
Section 10 of the Political Parties and Elections Act 2009 to be unworkable.

<p>The Coalition Government took the decision not to implement the 2009 legislation,
as it was not deemed to be workable, and the Conservative Government continues to
hold this view.</p><p>During the passage of the 2009 Act, the Electoral Commission
raised concerns about the legislation (further to Official Report, 15 October 2009,
Col. 998W), and in 2013, the Electoral Commission also flagged issues about the tax
status declaration requirements. The Labour Government conceded that the provisions
could not be commenced at that time “due to their complex nature” (as outlined in
the answer of Official Report, 10 March 2010, Col. 5MC).</p><p> </p><p>An individual’s
tax status is subject to confidentiality between them and HMRC. It may therefore be
difficult or impossible for the political party and the Electoral Commission to accurately
determine whether a donor meets the permissibility test set out section 10 in the
Political Parties and Elections Act 2009.</p><p>The Government also has a principled
objection to the measures:</p><p> </p><ul><li>The UK has a robust legal framework
in place that bans foreign donations. There is a long-standing principle – as originally
recommended by the Committee on Standards in Public Life in 1998 – that permissible
donors are those on the UK electoral register, and this includes UK citizens who are
registered overseas electors. Companies wishing to make donations must be UK-registered
and carrying on business in the UK.</li></ul><p> </p><ul><li>If a British citizen
is able to vote in an election for a political party, they should also be able to
donate to that political party, subject to the requirements for transparency on donations.
Supporting a political party is part of the democratic process, and is an expression
of freedom of association.</li></ul><p> </p><ul><li>Since the adoption of universal
suffrage, taxation has never been the basis of enfranchisement in the UK. Those who
do not pay income tax, such as those earning less than the tax-free personal allowance,
rightly remain entitled to vote. Similarly, full-time students are legally exempt
from paying council tax, but still have the right to vote in local elections.</li></ul><p>
</p><p>Notwithstanding, as I stated in my previous answer, the Government has announced
it will consult on strengthening the current provisions which protect UK politics
from foreign influence. The consultation may consider recommendations on tackling
loopholes in relation to foreign spending in elections and donations from shell companies
which are not properly operating in the UK.</p><p> </p><p>More broadly, since 2010,
the Government has taken action to sanction and deter those involved in offshore evasion,
including creating a new criminal offence for serious offshore evasion, and introducing
penalties for those who deliberately help others to evade tax offshore. The Government
has introduced over 100 new measures to tackle tax avoidance, evasion and non-compliance.</p>

To ask the Minister for the Cabinet Office, whether his Department has received representations
from the Electoral Commission on the workability of section 10 of the Political Parties
and Elections Act 2009.

<p>The Coalition Government took the decision not to implement the 2009 legislation,
as it was not deemed to be workable, and the Conservative Government continues to
hold this view.</p><p>During the passage of the 2009 Act, the Electoral Commission
raised concerns about the legislation (further to Official Report, 15 October 2009,
Col. 998W), and in 2013, the Electoral Commission also flagged issues about the tax
status declaration requirements. The Labour Government conceded that the provisions
could not be commenced at that time “due to their complex nature” (as outlined in
the answer of Official Report, 10 March 2010, Col. 5MC).</p><p> </p><p>An individual’s
tax status is subject to confidentiality between them and HMRC. It may therefore be
difficult or impossible for the political party and the Electoral Commission to accurately
determine whether a donor meets the permissibility test set out section 10 in the
Political Parties and Elections Act 2009.</p><p>The Government also has a principled
objection to the measures:</p><p> </p><ul><li>The UK has a robust legal framework
in place that bans foreign donations. There is a long-standing principle – as originally
recommended by the Committee on Standards in Public Life in 1998 – that permissible
donors are those on the UK electoral register, and this includes UK citizens who are
registered overseas electors. Companies wishing to make donations must be UK-registered
and carrying on business in the UK.</li></ul><p> </p><ul><li>If a British citizen
is able to vote in an election for a political party, they should also be able to
donate to that political party, subject to the requirements for transparency on donations.
Supporting a political party is part of the democratic process, and is an expression
of freedom of association.</li></ul><p> </p><ul><li>Since the adoption of universal
suffrage, taxation has never been the basis of enfranchisement in the UK. Those who
do not pay income tax, such as those earning less than the tax-free personal allowance,
rightly remain entitled to vote. Similarly, full-time students are legally exempt
from paying council tax, but still have the right to vote in local elections.</li></ul><p>
</p><p>Notwithstanding, as I stated in my previous answer, the Government has announced
it will consult on strengthening the current provisions which protect UK politics
from foreign influence. The consultation may consider recommendations on tackling
loopholes in relation to foreign spending in elections and donations from shell companies
which are not properly operating in the UK.</p><p> </p><p>More broadly, since 2010,
the Government has taken action to sanction and deter those involved in offshore evasion,
including creating a new criminal offence for serious offshore evasion, and introducing
penalties for those who deliberately help others to evade tax offshore. The Government
has introduced over 100 new measures to tackle tax avoidance, evasion and non-compliance.</p>